Revered Chicago indie label Touch & Go Records, which has been home to such iconic bands as Slint, the Jesus Lizard and Big Black, will stop releasing new albums and operate going forward as a catalog label.

A source at the label confirms the closure and adds that all albums slated to come out through the spring will still be released.

The source also said the announcement came as a complete surprise to everyone on staff. "Last week we were talking about South by Southwest, and now this has happened," said the source.

The label will cut 20 staffers, who will work for another six weeks and then exit. The label will then operate with a "skeleton crew" through the end of the year. Their distribution company will fold; a source says all the labels that use the service have been notified.

"It was business as usual on Friday, then I called in to a meeting on Monday and was told about the layoffs," said another source at the label.

Corey Rusk formed Touch & Go in 1981 at age 17, while living with his grandmother near Toledo, Ohio. He operated it in the early '80s from Detroit, but has called Chicago home since 1986.

The label has since been home to some of the most important and influential bands in the punk, indie, hardcore and experimental worlds, including Don Caballero, Scratch Acid, Urge Overkill, Calexico, Blonde Redhead, Silkworm, Rachel's, Mekons, Girls Against Boys, June Of 44, the Dirty Three and Seam.

In recent years, it released early albums from the Yeah Yeah Yeahs and TV On The Radio before both bands jumped to Interscope.

"Throughout the 25 years there have always been challenges," Rusk told Billboard in 2006. "Ultimately our goal is still the same. Doing the best job for the bands we work with does not mean selling as many records as possible. It means we have to be representing each band in a manner that's acceptable to them. Everyone we work with is different, and every band is going to be OK with you doing different things. One of the reasons we've lasted so long is that we're very conscious of feeling like we work for the band. They don't work for us."